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Active managment – Going beyond the index

The debate over the merits of active and passive investing has been going on for some time. Ivy believes investors can derive the most long-term benefit through exposure to well-researched actively managed funds.

Market Perspectives/ 05.08.20

Looking beyond stock market volatility

Market volatility can be unsettling, but history shows that prices have returned to less volatile patterns over time. That can be good news for long-term investors.

Market trends show long-term investors generally have been rewarded over time. However, periods of extreme volatility can challenge even the most seasoned investors. Ivy believes having a perspective of the markets and the factors affecting them can be helpful in assessing current opportunities.

Navigating the Psychological Toll of COVID-19

Discover practice tips to helping support your clients during the pandemic.

Genlink

A succession plan for the next generation

You’ve spent your career teaching clients the importance of retirement planning and how to protect their assets. But have you considered what will happen to your business when it comes time for you to pass it to the next generation of advisors?

Genlink

Generational happiness

From loyalty to impact and autonomy to experiences discover how each generation defines happiness.

Ivy Investments

We stand for a legacy of expertise, focused on delivering strong, long-term results. Our name reflects our progressive product offerings and growing global presence as we continue to adapt to the needs of investors.

Advisor Article

Half of Gen X clients don’t trust you - now what?

09.30.19

Gen Xers are part of a generation that came of age between two vastly different worlds: Cold War and post-Cold War, eight-bit computers and ultra-fast wireless Internet, big institutions that could never fail and the devastation of national and corporate images through events like the Challenger disaster and Enron. With the birth of cable television and, namely, the creation of 24-hour news media, Gen Xers grew up watching as big corporations, politicians, and financial institutions collapsed, opening their eyes to the harsh realities of the world around them, thus shaping a skeptical generation. Because of this, the Gen X hallmark is to constantly question and work to uncover truths, especially when it comes to working with large institutions, which are a reminder of the past.

Unfortunately, Gen Xers are bringing their skepticism straight into your practice. To start, Xers are less likely than Boomers and Millennials to believe they will have enough money in retirement to maintain the lifestyle they want.¹ And only half of Xers believe their advisor has their best interest as a top priority and only 35% believe their advisor would recognize them on the street.²

Here are five ways you can build lasting relationships with Gen X clients:

1 Embrace their independence

From an early age, Gen Xers, also known as latch key kids, came home from school to empty homes. They became comfortable managing themselves after school by completing their homework, doing chores, watching an after school special and making a microwave dinner. This generation grew up with the mantra, “If you want something done right, do it yourself.” True to their independent natures, Xers trust themselves almost two times more than anyone, including a financial advisor.3

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Don’t let their self-reliance scare you off. This busy generation doesn’t have the time or passion for what you do every day. The key is simple, embrace their independence. Start by helping them sift through the half-read report on investment trends they found. Identifying what is important and what is noise will save this time-squeezed generation. Next, talk to them about their individual needs and goals. Recognizing they aren’t like the last client you saw will instill confidence in your ability to personalize their needs. Finally, give them options and let them make the final decision.

2 Be transparent

Gen Xers grew up in an era of infomercials promoting Ginsu Knives and ThighMasters that over-promised and under-delivered. They are keenly aware of when someone is misleading them. One of the best ways to gain the trust of this generation is to be transparent.

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If you aren’t sure about something, don’t fake until you make it! Be honest and admit you don’t know the answer and tell them you will get back to them. Gen Xers will respect you for your honesty and will feel comfortable finding the answers with you. But, don’t forget the follow-up – if you don’t get back to them, you are sure to lose their confidence.

3 Accept their flaws

While Gen Xers may be skeptical, they aren’t naïve about their financial situations. Two-thirds of Xers admit to recently making at least one financial mistake.4 And when asked to grade themselves on their retirement savings, 39% gave themselves a grade of “C” or lower.5

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Instead of scolding them for carrying credit card debt or not maxing out their 401(k), help them by being upfront about their current situation and their ability, or inability to reach their long-term financial goals. Your straightforward advice will be a welcome change

4 Sell the relationship, not the product

The internet is giving Xers unprecedented access to financial information, causing them to feel suspicious and overwhelmed. Because of their level of distrust of online sources, 67% of Gen Xers think that, for financial help, personal relationships have become even more important.6

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To create a level of trust with Gen Xers, build a solid relationship with them before you ever try to close a deal. An Xer will balk at the product details, no matter how good, if they don’t feel you understand them. Advisors who take the time to help Gen Xers answer the questions that keep them up at night will be surprised

5 Put their family first

Gen Xers’ current life stage is demanding. They are raising children, climbing the corporate ladder and preparing for the wellbeing of their families and themselves. For 61% of Xers, the thought of providing for themselves and their family for the long-term is overwhelming.7 Another 46% of Xers are concerned about
the possible financial strain of caring for aging parents.8

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You can help Xer clients by being a liaison between family members and provideing a forum for open and honest communication. Encourage Xers to hold family meetings with their children to discuss what they plan to pay for in college and beyond to help manage expectations for parents and their Gen Z children. Extending family meetings to include siblings and parents to discuss assets, liabilities and expenses can help the entire family create the best financial scenario for everyone.

This information is provided for informational purposes only. Ivy Distributors, Inc., believes the information has been obtained from sources considered to be reliable, but does not guarantee the accuracy of the information provided.

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Related Articles

You’ve spent your career teaching clients the importance of retirement planning and how to protect their assets. But have you considered what will happen to your business when it comes time for you to pass it to the next generation of advisors?

As we start to experience the greatest wealth transfer in history, preventing assets from walking out the door will be a challenge for many financial advisors. Here are some tips to help you with intergenerational financial conversations to help ease the tension amid families.

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